Urban rail given green light by Gillard

The federal government has moved to snooker
Tony Abbott
on infrastructure funding by pledging $3.7 billion to fund rail projects in Victoria and Queensland, despite the Opposition Leader saying a Coalition government would not fund urban rail projects.

As part of the next phase of its Nation Building Program, the government has allocated $24 billion to new road and rail projects up to 2018-19, including $3 billion for the Melbourne Metro and $715 million for the Cross River Rail in Brisbane, but it will be conditional on state governments matching the funding and a new alliance with the private sector to deliver the projects.

There is also new funding for major roads in Sydney, including $1.8 billion for the M4 extension and M5 duplication and $400 million for the F3-M2 “missing link" to be delivered with the NSW government.

However, the next phase of the Nation Building Program will not kick in until 2014-15, and a lot of the promised money will not be flowing until early next decade.

The federal government claimed it had locked in $60 billion in infrastructure funding since 2008-09.

The new money also includes $500 million over 10 years for the Perth Light Rail Project and Airport Link.

The government’s bag of cash for large rail projects in the conservative states will be partly seen as an attempt to corner Mr Abbott, who said in April he would not fund urban rail projects.

Infrastructure Minister
Anthony Albanese
said the rail projects in Brisbane and Melbourne were “shovel ready" and had been vetted by the government’s advisory body, Infrastructure Australia.

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He said a memorandum of understanding had been drafted by state and federal officials which should be locked in before the September election.

Mr Albanese said he was confident that both the Napthine and Newman governments would sign up to the new funding.

“They should because it’s what they have both been asking for," Mr Albanese told The Australian Financial Review.

“Without Cross River Rail in Brisbane and Melbourne Metro there will be major gridlock in those cities."

The Melbourne Metro project, a nine kilometre underground railway from South Kensington to South Yarra, is expected to cost $9.2 billion.

The federal government said it would make a contribution of up to $3 billion. The remaining funding is to come from the private sector, which is expected to receive availability payments from government.

About $1 billion in new federal funding will flow into the project between 2014-15 and 2018-19, but the majority of the funding ($2 billion) will not be allocated until between 2019-20 to 2023-24.

The Commonwealth will stump up $715 million to the $5.2 billion Cross River Rail project, a 10 kilometre rail link with four new underground ­stations, and the private sector is once again being asked to help fund the shortfall,

Mr Albanese ridiculed Mr Abbott’s comments on urban rail funding, ­saying the Commonwealth was investing in public transport across Australia.

“The Commonwealth has been investing in 21st century infrastructure, which includes urban rail," he said.

The government has allocated $3.2 million to engage private sector experts to help formulate the new funding models for the Melbourne and ­Brisbane rail projects. This could include concessional loans to the private sector as well as the Commonwealth and state sharing availability payments to the private sector.